The Italian government said Thursday it will try to determine whether an agreement remains possible between Air France-KLM and Alitalia unions after the French-Dutch company pulled out of take-over talks.
"The government ... will take steps to verify whether the developments in the negotiations (of Wednesday) and subsequent statements by Alitalia and Air France signify the definitive collapse" of the talks, the government said in a statement.
The outgoing centre-left government of Romano Prodi will seek to determine whether "the possibility still exists of agreement with the unions," the statement said.
Air France-KLM's bid to take over Alitalia fell apart on Wednesday as union negotiations broke down and the failing Italian flag carrier's chairman Maurizio Prato resigned. Prodi, who will leave office when Italy holds elections April 13-14, on Wednesday blamed the unions for the breakdown, accusing them of committing a "great mistake."
The unions had asked Air France-KLM to maintain all of the company's activities, while the Franco-Dutch group planned to drop the cargo service and part of the ground maintenance unit AZ Servizi. Air France-KLM boss Jean-Cyril Spinetta said the counter proposals reintroduced a long-discarded framework, going "beyond my mandate, so I have to refer them to my board of directors."
Barring a stunning new development, Alitalia will now have to embark on long and painful bankruptcy proceedings. Alitalia's board of directors was set to meet at 1:00 pm (1100 GMT) on Thursday. Prato, named in August 2007, agreed with the basic elements of Air France-KLM's proposed deal for the take-over of Alitalia and had repeatedly hinted that he would step down if a deal was not reached. The European giant had said it wanted all the unions to agree to the take-over plan before it went forward.